HRABOVE, Ukraine/WASHINGTON, July 19 (Reuters) - U.S.
President Barack Obama said the downing of a Malaysian jetliner
in a Ukrainian region controlled by Russian-backed separatists
should be a "wake-up call for Europe and the world" in a crisis
that appears to be at a turning point and warned Russia of
possible tightening of sanctions.

While stopping short of blaming Russia for Thursday's crash
of Malaysia Airlines Flight MH17, in which 298 people
died, Obama accused Moscow of failing to stop the violence that
made it possible to shoot down the plane.

The United States has said the jetliner was hit by a
surface-to-air missile fired from rebel territory.

A senior U.S. official said there was increasing confidence
that the missile was fired by separatists and that there was no
reason to doubt the validity of a widely circulated audiotape in
which voices identified as separatists discussed the downing of
the plane.

"This certainly will be a wake-up call for Europe and the
world that there are consequences to an escalating conflict in
eastern Ukraine; that it is not going to be localized, it is not
going to be contained," Obama told reporters on Friday.

Obama spoke by phone later with German Chancellor Angela
Merkel, British Prime Minister David Cameron and Australian
Prime Minister Tony Abbott. The White House said they discussed
Ukraine and the downed jet and the need for an unimpeded
international investigation into what happened.

Malaysian Transport Minister Liow Tiong Lai said on Saturday
he would fly to the Ukraine capital of Kiev to ensure an
investigating team gets safe access to the site.

Defence Minister and former transport minister Hishammuddin
Hussein said a main priority was to ensure debris was not
tampered with.

"We want to get to the bottom of this," he added, saying
that Malaysia had been in touch with officials in Russia,
Ukraine, the United States, Britain and China.

"We do not have a position until the facts have been
verified, whether the plane was really brought down, how it was
brought down, who brought it down," he said.

Chinese President Xi Jinping called for a fair and objective
investigation as soon as possible.

International observers said gunmen stopped them examining
the site properly when they got there on Friday. More than half
of the victims were Dutch in what has become a pivotal incident
in deteriorating relations between Russia and the West.

Obama ruled out military intervention but said he was
prepared to tighten sanctions.

Russia, which Obama said was letting the rebels bring in
weapons, has expressed anger at implications it was to blame,
saying people should not prejudge the outcome of an inquiry.

There were no survivors from Flight MH17 from Amsterdam to
Kuala Lumpur, a Boeing 777. The United Nations said 80 of the
298 aboard were children. The deadliest attack on a commercial
airliner, it scattered bodies over miles of rebel-held territory
near the border with Russia.

The loss was the second devastating blow for Malaysia
Airlines and the country this year, following the disappearance
of Flight MH370 in March with 239 passengers and crew on board
on its way from Kuala Lumpur to Beijing.

Makeshift white flags marked where bodies lay in corn fields
and among the debris. Others, stripped bare by the force of the
crash, had been covered by polythene sheeting weighed down by
stones, one marked with a flower in remembrance.

One pensioner told how a woman smashed though her roof.
"There was a howling noise and everything started to rattle.
Then objects started falling out of the sky," said Irina
Tipunova, 65. "And then I heard a roar and she landed in the
kitchen."

INVESTIGATION HAMPERED

As U.S. investigators prepared to head to Ukraine to assist
in the investigation, staff from Europe's OSCE security body
visited the site but complained that they did not get the full
access they wanted.

"We encountered armed personnel who acted in a very impolite
and unprofessional manner. Some of them even looked slightly
intoxicated," an OSCE spokesman said.

The scale of the disaster could prove a turning point for
international pressure to resolve the crisis in Ukraine, which
has killed hundreds since pro-Western protests toppled the
Moscow-backed president in Kiev in February and Russia annexed
the Crimea peninsula a month later.

"This outrageous event underscores that it is time for peace
and security to be restored in Ukraine," Obama said, adding that
Russia had failed to use its influence to curb rebel violence.

While the West has imposed sanctions on Russia over Ukraine,
the United States has been more aggressive than the European
Union. Analysts say the response of Germany and other EU powers
to the incident - possibly imposing more sanctions - could be
crucial in deciding the next phase of the standoff with Moscow.

Some commentators even recalled Germany's sinking of the
Atlantic liner Lusitania in 1915, which helped push the United
States into World War One, but outrage in the West at Thursday's
carnage is not seen as leading to military intervention.

The U.N. Security Council called for a "full, thorough and
independent international investigation" into the downing of the
plane and "appropriate accountability" for those responsible.

German Chancellor Angela Merkel said it was too early to
decide on further sanctions before it was known exactly what had
happened to the plane. Britain took a similar line but later
echoed Obama in pointing the finger at the separatists.

Kiev and Moscow immediately blamed each other for the
disaster, triggering a new phase in their propaganda war.

CRASH SITE

The plane crashed about 40 km (25 miles) from the border
with Russia near the regional capital of Donetsk, an area that
is a stronghold of rebels who have been fighting Ukrainian
government forces and have brought down military aircraft.

Leaders of the rebels' self-proclaimed Donetsk People's
Republic denied any involvement and said a Ukrainian air force
jet had brought down the plane.

Russia's Defence Ministry later laid the blame with
Ukrainian ground forces, saying it had picked up radar activity
from a Ukrainian missile system south of Donetsk when the
airliner was brought down, Russian media reported.

The Ukrainian security council said no missiles had been
fired from its armouries. Officials also accused separatists of
moving unused missiles into Russia after the incident.

The Ukrainian government released recordings it said were of
Russian intelligence officers discussing the shooting down of a
civilian airliner by rebels who may have mistaken it for a
Ukrainian military plane.

After the downing of several Ukrainian military aircraft in
the area in recent months, including two earlier this week, Kiev
had accused Russian forces of playing a direct role.

Separatists were quoted in Russian media last month saying
they had acquired a long-range SA-11 anti-aircraft system.

The OSCE monitors said they could not find anyone to talk to
about the plane's two black boxes - voice and data recorders -
and villagers were seen removing pieces of wreckage.

Reuters journalists saw burning and charred wreckage bearing
the red and blue Malaysia Airlines insignia and dozens of bodies
in fields near the village of Hrabove, known in Russian as
Grabovo.

Ukraine said on Friday that up to 181 bodies had been found.
The airline said it was carrying 283 passengers and 15 crew.

Ukraine has closed air space over the east of the country as
Malaysia Airlines defended its use of a route that some other
carriers had been avoiding.

The Malaysian government is likely to come under further
pressure after saying on Friday that the flight path over
Ukraine had been declared safe by the U.N. International Civil
Aviation Organization (ICAO) which, it said, had since closed
the route.

The ICAO later said it did not have the power to open or
close routes and that individual nations were responsible for
advising on potential hazards.

International air lanes had been open in the area, although
only above 32,000 feet. The Malaysia plane was flying 1,000 feet
higher, at the instruction of Ukrainian air traffic control,
although the airline had asked to fly at 35,000 feet.

More than half of the dead passengers, 189 people, were
Dutch. Twenty-nine were Malaysian, 27 Australian, 12 Indonesian,
10 British, four German, four Belgian, three Filipino, one
American, one Canadian, and one from New Zealand. Several were
unidentified and some may have had dual citizenship. The 15 crew
were Malaysian.
(Additional reporting by Natalya Zinets, Pavel Polityuk, Peter
Graff and Elizabeth Piper in Kiev, Tim Heritage, Vladimir
Soldatkin, Polina Devitt, Thomas Grove and Gabriela Baczynska in
Moscow, Thomas Escritt in Amsterdam, Anuradha Raghu, Siva
Govindasamy and Trinna Leong in Kuala Lumpur, Jane Wardell and
Matt Siegel in Sydney and Phil Stewart, Warren Strobel, Steve
Holland and Matt Spetalnick in Washington and Paul Carsten in
Beijing; Writing by Giles Elgood and Philippa Fletcher; Editing
by Alastair Macdonald, Toni Reinhold, Nick Macfie and Paul Tait)